On January 6 Governor Chris Christie signed a five-year transportation plan designed to change the way the state pays for critical infrastructure. Traditionally, state road and infrastructure projects have been paid for by taxes. Christie’s plan looks to fund such projects through the state General Fund and the New Jersey Turnpike Authority, with bonds, a nd with $1.8 billion in unused Port Authority funding from the scrapped Hudson River ARC tunnel project.

Critics of the idea to reuse the ARC funding have questioned whether Christie had his sights on the money for statewide road projects all along. Senator Frank Lautenberg (Democrat), who helped secure $3 billion in federal funds toward ARC, in fact, said that the new Christie plan is evidence that the Republican governor had such plans all along. Christie backed out of the ARC plan in October, saying he feared cost overruns.

But Christie denied the accusations at the January 6 press conference and went on the offensive. “Today, we are continuing to put New Jersey on the path towards fiscal health and proposing a sensible and responsible plan that prioritizes vital transportation projects, while limiting the already-heavy debt burden carried by the taxpayers of our state,” he said. “After years of mismanagement and the failure to soundly plan for New Jersey’s transportation future, we were left with an unacceptable situation — a system teetering on the edge of failure, without the ability to fund a basic, core function of government.”

John Wisniewski, a Democrat and chairman of the Transportation Committee, said that Christie is merely putting off the problem for another five years.

Other critics say that with its hearkening back to the days when road construction was a priority over transportation, Christie’s plan obscures efforts to promote mass transit. The Christie administration has long acknowledged that the state’s existing roads and bridges are in need of attention.

According to the governor’s office, the state will provide $1.6 billion each year for five years for much-needed transportation projects throughout New Jersey. The projects include a $672 million investment in New Jersey Transit and $200 million per year for local government projects. The plan calls for no new taxes and cuts the reliance on borrowing in half.

The state’s former plan, which began in 2007 under Governor Jon Corzine, provided $8 billion ($1.6 billion per year) for transportation projects, including $200 million per year for local government projects. This plan, according to Christie’s office, relied on a stable $895 million annual General Fund appropriation that became almost entirely devoted to making debt payments, instead of funding current transportation needs.

It also relied on the ability to pay off debts after the bonds’ 30-year cycle was up. Christie’s plan touts a “pay as you go” philosophy, in which the state will pay down any debts over the 30-year life cycle of any loans.

“Ultimately, the only way to continue paying for projects was for the state to incur debt,” the governor said. Money from the 2007 plan is due to run out this year, with debt eating up the last $900 million of it.

The Christie Plan includes the sixth successive reauthorization of the Transportation Trust Fund. Trust Fund borrowing is backed by state appropriations from constitutionally dedicated revenue streams — the motor fuels tax, the petroleum products gross receipts tax, and the sales and use tax. This means that any new appropriations do not need to meet with public approval.

#b#New Jersey Future’s Take On Christie’s Transportation Plan#/b#

New Jersey Future Executive Director Peter Kasabach issued the following statement in response to Governor Chris Christie’s announced five-year plan for replenishing the Transportation Trust Fund:

A safe and reliable transportation system is critical to New Jersey’s future prosperity, and the system should be funded from a stable and sustainable funding source. When it was created, the Transportation Trust Fund was intended to be that source. Over the years, however, the fund has been systematically mismanaged, overloaded with debt, and brought repeatedly to the brink of bankruptcy.

The proposal presented by the Governor today begins to head in the right direction. It addresses the immediate need to replenish the Trust Fund, moves away from excessive reliance on debt and back toward the ‘pay-as-you-go’ model on which the fund was founded. Importantly, it provides an increase in funding for NJ Transit, a critically important step in the wake of last year’s fare hikes and service cuts. This immediate replenishment of the fund will enable many worthy projects to continue, and thousands of people to remain working in this time of high unemployment.

This is not, however, a sustainable solution to the Trust Fund. At the end of its five-year timetable, it will leave New Jersey taxpayers burdened with a higher level of debt than they face today. It also relies on sources of funding that may or may not be forthcoming; for example, it anticipates tapping the Port Authority of New York and New Jersey for more money than the bi-state agency may be willing to direct to New Jersey projects.

While we recognize the fiscal limitations facing the state, we believe it is essential that the Governor and Legislature develop a plan for a fiscally sustainable solution to the Trust Fund. Equally important, we must start thinking not only about how we finance our state’s ongoing transportation needs, but how we plan, manage and operate our entire transportation system. Instead of focusing on the amount of money that is spent each year, we should instead focus on outcomes: fixing our deficient bridges, improving safety, reducing commute times, increasing transit ridership, decreasing carbon emissions and using transportation investments to encourage smart growth. These should be the goals by which our transportation system is measured.”

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